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Dow Jumps for Joy at Prospect of a Prosperous New Year

Was it just coincidence that the Dow spiked when the Chicago Fed released its shiny outlook for 2014?

The economic calendar is pretty spare today, but two big items seem to be giving the Dow Jones Industrial Average(DJINDICES:^DJI) a lift just before noon. In a paroxysm of ambition, the U.S. Congress seems willing and able to wrap up a new budget well before Christmas. Though big issues such as sequester cuts and the debt ceiling are not truly being addressed, any forward motion in Washington is a good thing, particularly following the shutdown drama in October.

The Dow's 0.13% rise may very well also be attributed to a news release from the Federal Reserve Bank of Chicago, which painted a bright economic picture for 2014. It is drawing on the consensus of opinions garnered last week at the Economic Outlook Symposium, where participants indicated they expect real GDP growth of 2.7%, compared with this year's 2%. Also expected to rise are housing starts and industrial production, while unemployment is predicted to drop to 6.8%.

In addition, three Federal Reserve heavy-hitters will speak at various locales later today. The market is doubtless anticipating another opportunity to piece together the puzzle of exactly when the tapering of quantitative easing will begin.

Busy big banksMore information about big banks' foibles came to light over the weekend, as the federal government scrutinized emails from JPMorgan Chase(NYSE:JPM) regarding its hiring practices in China. Authorities have been looking into how big banks like JPMorgan and Goldman Sachs(NYSE:GS) do business in that country, specifically how the hiring of family members of China's ruling class has helped secure business for the institutions. The emails have been enlightening for federal authorities, showing a linear progression between hiring certain individuals and an increase in business deals.

Also, Bloomberg reported over the weekend that a former Goldman trader was sentenced to nine months in prison for his part in a secret trade that cost the bank $118 million back in 2007.

Big banks are loading their guns against the advent of the Volcker rule, which is expected to be voted into law tomorrow. Big Wall Street players like JPMorgan and Goldman are predicted to be ready with lawsuits to try to stop implementation, arguing that banning proprietary trading, in which banks use their own funds for trades, will hurt the market.